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There’s a real trick to figuring out how to play recent IPOs. Oftentimes, the underlying business may not be all that great, but the hype surrounding the IPO may drive the stock far higher than it deserves. I personally do not think the valuations on Linkedin (NASDAQ:LNKD) and OpenTable (NASDAQ:OPEN) are deserved, but that doesn’t mean those stocks won’t go higher. Therefore, shorting them is not for the faint of heart.

In the cases of the aforementioned stocks, I can see what the revenue model is and how the business might be sustainable. But neither of those stocks solves a problem. (That’s something Marc Cuban has also said to watch for.)

This brings us to Groupon (NASDAQ:GRPN). It, too, doesn’t solve a problem. It’s just another coupon company. Yes, it provides fantastic discounts, but it also reminds me of the early days of eBay (NASDAQ:EBAY). People thought it was such a cool idea that it created this false rush of traffic that has not been sustainable.

With Groupon, people run to buy at these great discounts, but soon they’ll realize that the coupon or discount often goes unused, making the purchase pricey indeed. Customers will learn to be a lot more careful about jumping on those bargains.

We are already seeing decelerating revenue growth. While Groupon’s YOY revenue growth approached 200%, on a quarter-to-quarter basis, it was only 20% — and management guided to under 10% for Q1.

The other problem with Groupon is that there is no barrier to entry. Yes, it has a brand name, but it’s hardly a first-mover. Anybody can create the same kind of business. LivingSocial.com does the same thing, and so does Luxurylink.com.

Analysts are pegging 2013 earnings at $0.83 per share, or about $400 million in net income. But I don’t know how that’s going to happen when revenue growth is decelerating at this rate. Even using that estimate, the company is presently valued at over $10 billion. Oh, and Groupon reported a 2-cent-per-share loss on Feb. 8 for its Q4, versus estimates of a 3-cent profit.

I do not see Groupon as a long-term sustainable business. That doesn’t mean the stock can’t go higher, though. I’d look for a combination of a stock-price pop followed by a disappointing earnings release before I’d short. Otherwise, stay away.

As of this writing, Lawrence Meyers did not hold a position in any of the aforementioned securities.